SANTA CRUZ — A 49-year-old engineer at the Legion of Honor art museum in San Francisco pleaded not guilty Tuesday to allegations that he fondled two children younger than 14 over seven months in Santa Cruz County.

James Edward Taylor of San Francisco was charged with felony lewd or lascivious acts with two children younger than 14, according to court records. Sheriff”s deputies arrested Taylor without incident Thursday morning at his office at the Legion of Honor, according to Santa Cruz County sheriff”s Sgt. Todd Liberty.

Deputies also seized a computer from Taylor”s home in San Francisco the same day, Liberty said. The arrest came on the heels of an investigation that began in late December with a report from a Santa Cruz County family. Taylor”s attorney said he faces several years in prison if convicted.

“We believe we have a strong case,” Liberty said.

Taylor befriended parents and their children in Santa Cruz County, and he is accused of putting his hand between the legs of two children, authorities said. There were four alleged occasions from April 1 to Nov. 8, 2010, said Sgt. Bill Gazza.

Taylor appeared in court in orange jail clothes Tuesday, taking several deep breaths and looking worried during his arraignment. He pleaded not guilty, and his attorney, Mary Conn of Santa Cruz, was granted a request for a bail hearing on Thursday.

Taylor is being held in County Jail in lieu of $350,000 bail. Conn argued that Taylor is a low flight risk. She said she will ask for a reduced bail amount.

“He”s not the kind of guy — given his social and professional status — to jump bail,” Conn said in an interview. “He”s a stable citizen.”

Taylor”s wife and a few family friends attended Tuesday”s court hearing.

Taylor has no arrest record in Santa Cruz County, according to records, and Conn said he has no criminal history in San Francisco. Taylor is on leave from the Legion of Honor, his attorney said.

The Legion of Honor and de Young Museums are the largest public arts institutions in San Francisco, according to its website. The Legion of Honor houses mainly classical and Asian art and was built in 1924.

Jill Lynch, a spokeswoman for the Legion of Honor, confirmed that Taylor worked there but declined to discuss the matter further. Lynch declined to say whether Taylor had contact with children at work.

Taylor is due in Judge Paul Marigonda”s court Thursday for the bail hearing and on Jan. 27 to confirm a preliminary hearing set for Jan. 31.